Software Audit Tools
The Right Tool for the Job
Since the beginning of 2011, providers have been
overwhelmed by a tidal wave of pre- and post-payment
Medicare audits that has upended the industry.
Providers have been trying to keep their heads above
a sea of requests for documentation, and didn’t necessary
have the tools or business processes in place to
respond to the requests. And the longer the process,
the longer their funding is held in limbo.
And there’s no end to this audit storm surge in
sight. CMS’s commitment to Medicare audits has
been immense. CMS ramped up its program integrity
budget over the past two years, building up a vast
reservoir of auditing resources. In the fiscal year of
2010, $311 million was invested for program integrity;
a 50 percent increase from 2009’s outlay. The payoff
for CMS has been considerable. Approximately $3
billion was recovered in 2010, and the government
estimated it would recover more $10 billion in 2011
(the results of last year’s audits are still being tabulated
Moreover, not only has the volume of audits been
ramped up, but the intensity of the auditing process.
Some types of CMS audits, such as ZPIC audits, can
be extremely aggressive. If a provider suffers from
numerous claims lacking the proper documentation,
the ZPIC auditors can put the provider on 100 percent
pre-payment audit. That means every claim is held up
until the auditors are satisfied.
So, providers have had to beef up their documentation
efforts to ensure that they are getting the
right documentation with each and every incoming
claim, and that it is formatted in such a way that it
will not raise a red flag. To that end, one of tools to
help providers make the audit process as smooth and
rapid as possible is software. The billing, claims and
management systems they have in place often can help
providers respond to audits in many ways. Without a
doubt, information technology has become a central
asset in providers’ audit response strategies.
Software doesn’t help providers avoid audits, but it does help them
prepare for, respond to and weather an audit. HME software gives
providers access to the data houses all documentation electronically
which inherently makes responding to audits much easier for HME providers.
When audited the provider is made aware of what documentation it
needs to provide auditors to demonstrate a claim’s validity and can use its
information technology to quickly find that documentation and send it to
auditors. And the software system should help provider ensure that it is
In an HME software system, when an order is taken and claim is started,
documentation and the requests to referral partners and other parties for
necessary documentation should be generated and tracked and managed
through the software’s workflow process.
Document Imaging and Management
A key software tool that can help HME providers quickly retrieve the
necessary information is document imaging and management. Document
imaging lets employees can quickly scan paper forms in order to update
patient records, and update those files easily. Document management lets
staff organize, access and share those files. In many cases the two will be
referred to together as “document management.” In any case, this remains
the pivotal tool in helping providers quickly respond to audits.
With in the proper use of our software, documents are tracked and
monitored and imaged, and we are also interfacing with the carriers for
proof of delivery, which has also become a critical portion of the audits, as
it is another form of documentation to confirm that the patients are being
“We can scan the items in on the patient’s record, so that every thing
I need can be printed out,” says Carol Rose, billing coordinator for Holly
Springs, N.C. HME provider Dressen Medical Inc. Dressen’s system also lets
Rose retrieve all the documents and EOBs for a particular patient, and get a
full history of that patient’s claims. And she can add notes, and set follow-up
dates to check to ensure that additional documentation has come in so that
it can get Medicare for claims or to auditors.
Because of the sheer volume of audits that providers go through, they must
also find a way to make sense of all their audited claims. So, reporting and
monitoring systems that can help them determine factors such as how many
claims are in audit, at what step in the process they are at, how many dollars
are outstanding, and which audits need to go to appeal is very important,
especially when a provider is dealing with high volumes of audited claims.
And these tools let the provider audit itself, as well. According to experts,
95 percent of Medicare audits result from data analysis. The process is
called predictive modeling, and is nothing new. It has been used in the
financial industry for years to detect fraudulent transactions. So, if the
auditing process is automated, why shouldn’t the providers analyze their
claims using similar, automated methods? Essentially, these tools can help
the provider notice the same red flags that CMS auditors are seeking.
And if a provider detects a situation where it can detect that certain
claims it is processing are going to run a higher risk of being audited, then
it can adjust for that. In fact, some types of claims that could have a higher
audit risk can be very simply addressed through a new process or workflow
thanks to this process.
Points to take away:
- Providers are drowning in a sea of audit requests, and their funding is being
held in limbo until they address those audits.
- Software has become a pivotal tool in how providers handle those audit
- A key feature of HME software that helps providers respond to audits is
document imaging and management tools.
- Also, reporting lets providers identify trends in their workflows that can
help them pinpoint possible audit concerns.
Our recent listing of software audit features that can be found on hme-business.com.
This article originally appeared in the June 2012 issue of HME Business.